Luis Cano's Monterey County Real Estate Blog

MISTAKE NO. 7 … Not following through on due diligence.

HERE’S IS HOW TO AVOID IT … Make a list of any concerns you have relating to isuues such as crime rates, schools, power lines, neighbors, environmental conditions,ect. Ask the important questions before you make an offer on a home. Be diligent so that you can have confidence in your purchase.

MISTAKE NO. 6 … Not considering long-term needs.

HERE’S HOW TO AVOID IT … It is important to think ahead. Will your home suit your needs 3-5 years from now? How about 5-10 years?

The complexity of new home buyer tax credits leaves potential buyers with many questions. Here are answers to some of the most confusing:

How does a current home owner qualify for the $6,500 credit?
Buyers must have lived in their homes for at least five out of the last eight years. The home they buy must become their primary residence, but buyers don’t have to sell their previous home. They can use the previous home as a rental or a second home and still claim the credit.

Does the new home have to be more expensive than the one the buyer currently owns?
No. It is fine to use it to downsize. If the property sells for more than $800,000, the buyers don’t qualify.

Can buyers who are building a new home claim the credit?
Yes, although the contract must be in place by April 30 and the buyer must move in by July 1.

Can buyers claim the credit if they purchase a home from a relative?
No. The legislation prohibits taxpayers from claiming the credit if the sale is between “related parties,” including parent, grandparent, child, or grandchild.

Source: USA Today, Sandra Block (11/24/2009)